n SA Mercantile Law Journal = SA Tydskrif vir Handelsreg - Unfair enforcement of a contract : a step in the right direction? Botha v Rich and Combined Developers v Arun Holdings : case note
|Article Title||Unfair enforcement of a contract : a step in the right direction? Botha v Rich and Combined Developers v Arun Holdings : case note|
|© Publisher:||Juta Law Publishing|
|Journal||SA Mercantile Law Journal = SA Tydskrif vir Handelsreg|
|Affiliations||1 University of KwaZulu-Natal|
|Publication Date||Jan 2015|
|Pages||174 - 190|
It is well-established that a contractual provision that is not, per se, illegal will not be enforced if the enforcement would be contrary to public policy (see e.g. Nyandeni Local Municipality v Hlazo 2010 (4) SA 261 (ECM) paras 81-4; Bredenkamp v Standard Bank of South Africa Ltd 2010 (4) SA 468 (SCA) para 47; GF v SH 2011 (3) SA 25 (GNP) paras 18-22). In applying this principle, the Supreme Court of Appeal has adopted the somewhat dogmatic position that merely because enforcement of a contractual provision would produce an unfair or unreasonable result does not make the enforcement offensive to public policy (see e.g. Bredenkamp v Standard Bank of South Africa Ltd 2010 (4) SA 468 (SCA) paras 50-52 ; Maphango v Aengus Lifestyle Properties (Pty) Ltd 2011 (5) SA 19 (SCA) paras 22-25; Potgieter v Potgieter 2012 (1) SA 637 (SCA) paras 31-34; cf also Brisley v Drotsky 2002 (4) SA 1 (SCA) paras 11-12). In Botha v Rich 2014 (4) SA 124 (CC), the Constitutional Court effectively rejected this approach by accepting that, on the facts of that case, unfairness or unreasonableness was, in itself, a sufficient ground for declining to enforce a contractual provision. The judgment in Botha's case is unsatisfactory in certain respects (not least of which its failure to mention, let alone consider, the appeal court cases referred to above) but, being a judgment of the Constitutional Court, it may well be regarded as marking the beginning of a new judicial attitude to unfair enforcement of contractual terms.
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